Turner Pope Research Note, 22nd November 2021

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Zephyr Energy has entered into a binding agreement to acquire a large portfolio of working interests in 228 wells, of which 163 are already producing, from Kaiser Acquisition and Development – Sanish Non-op LLC for a consideration of US$36m. This deal is forecasted to be highly accretive as well as non-dilutive for shareholders and following the payment of a non-refundable deposit of US$3.0m, the balance is expected to be funded through a structured debt facility. We believe that this transaction will be transformational for Zephyr, contributing an initial 871 boepd of production to the company upon the anticipated closing date of 22 December 2021. However, we expect net output to increase to over 1,100 boepd net to Zephyr as additional wells are brought on stream in early 2022.

We would draw your attention to the various disclaimers in the document both at the beginning and at the end of the note. Retail clients (as defined by the rules of the FCA) must not rely on the research document. In particular you should note that the research document is a non-independent marketing communication. The analyst who has prepared the research is aware that TPI provides research to Rose Petroleum plc. Accordingly the research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibitions on dealing ahead of its dissemination.

The information in the document is published solely for information purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The material contained in the document is general information intended for recipients who understand the risks associated with equity investment in smaller companies. It does not constitute a personal recommendation as defined by the FCA or take into account the particular investment objectives, financial situation or needs of individual investors nor provide any indication as to whether an investment, a course of action or the associated risks are suitable for the recipient.

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